Use the Following to Answer Questions

question 358

Multiple Choice

Use the following to answer questions:
Scenario: Music Downloads and Streamed Movies
Phillip has an income of $300 per month, which he uses to purchase music downloads (MD) and streamed movies (SM) . Each music download costs $1 and each streamed movie costs $5.
-(Scenario: Music Downloads and Streamed Movies) Read the scenario Music Downloads and Streamed Movies. Phillip's optimal consumption bundle will be one whose:

• A) budget line is tangent to his highest indifference curve.
• B) budget line intersects his highest indifference curve.
• C) budget line intersects the music download axis.
• D) indifference curve intersects the streamed movies axis.